A group of employees at state-owned regional airline SA Express are still desperately hoping that government will be able to assist them in getting their unpaid salaries – last paid in February – as well as retrenchment packages.
Unlike South African Airways, which is still in business rescue, SA Express has fallen one notch further and is already dangling over the cliff in provisional liquidation.
SA Express was provisionally liquidated at the end of April this year after a failed business rescue attempt. A court date was originally set for 9 June for any party to come and show why the airline should not be placed in final liquidation. However, due to the possibility that a still-unnamed potential investor may be interested in the airline, the matter has been postponed until 9 September.
For months now, a group of SA Express employees has been picketing on and off at the offices of the department of public enterprises (DPE), asking for help in getting unpaid salaries and retrenchment packages.
They have written an open letter saying they are being wrongfully “punished” for past corruption and mismanagement at SA Express while the airline was actually under the watch of the DPE.
In an email dated 23 July and seen by Fin24, the group received feedback from Nonny Mashika, the DPE’s deputy director general for aviation, to say that the department has been liaising with the provisional liquidator of the airline “to identify a holistic approach” to the challenges faced by the employees. Mashika said further engagements with the provisional liquidator will be undertaken, and the department has asked her to explore all options available for further consideration by government.
She also indicated that the DPE continues to engage with National Treasury and other agencies of government to seek a solution to the challenges faced by the SA Express employees. There is as yet no indication whether such a solution will be possible, given the dire financial position of SA Express.
In another email, dated Sunday 26 July and seen by Fin24, DPE acting director general Kgathatso Tlhakudi, informs Mashika to remind the group of SA Express employees that government, as the airline’s shareholder, does not have a legal obligation to pay for severance packages at SA Express and that the department merely undertook to investigate potential assistance in this regard “on humanitarian grounds”.
Tlhakudi indicates that there are a number of hurdles that need to be overcome for the demands of the employees to be met. These include finding funds within a constrained fiscal space; balancing the demands of the employees as creditors with those of the other creditors of SA Express; and the legal rules that prescribe the provisional liquidation process which have to be followed.
“The liquidation process makes provision for the disbursements to employees in line with the prescripts of the applicable law and that process should be allowed to run its course,” Tlhakudi says in his most recent feedback.
“The activism that has been displayed on this matter would have helped when the business was getting looted by the management of SA Express, whose shenanigans where exposed at the Zondo Commission, and the employees should have been aware of. The department has called on the criminal justice system to act on these former leaders.”